It is difficult to fathom that just four trading days ago MCR was trading at 46.5c when today it closed at 65.5c. Was the investment community up to this time so myopic that it massively undervalued MCR? I suspect the answer to that question is a resounding YES!
A rise of 41% in four days and it still looks strong. Note that no speeding ticket has been issued. The PON has risen 7% over the same period which is nice but not enough to justify this 40% rise. It's also pretty clear that they will announce a dividend as part of the year end results. But that will not be news. So that can't be the reason for the rise either.
My guess is that the rise is due to the Diggers and Dealers presentation MCR made on 7 August, has simply reminded people of what a great company this still is. That presentation gave some clarity about how 2013 went and also forecasts for 2014. The company looks great, and the sad fact is it was grossly overlooked.
1. It has 32c per share cash
2. It pays an 6-8% fully franked dividend
3. Its continuing to increase production and cut costs
What more can you ask for?
A more reasonable value for MCR seems to me to be $1.00.
K
breakout!!, page-7
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